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While revenue and earnings suffered steep declines, analysts were expecting worse, and investors continue to bet that a partnership with Oprah Winfrey will save the company.

What: Shares of weight loss management company Weight Watchers(NYSE:WTW) surged on Friday following the company's third-quarter earnings report. While revenue declined significantly year-over-year, the company beat analyst estimates across the board. At 12:40 p.m. Friday, the stock was up about 35% from the previous close.

So what: Weight Watchers reported quarterly revenue of $273.3 million, down 20.8% year-over-year but about $7 million higher than analysts were expecting. Last month, Weight Watchers announced a deep partnership with Oprah Winfrey, and in December the company plans to launch "a comprehensive program innovation as we expand our purpose from weight loss alone to more broadly helping people lead healthier, happier lives," according to CEO Jim Chambers.

Non-GAAP EPS was $0.39, down 42% year-over-year but $0.10 higher than the average analyst estimate. The total number of subscribers declined by 12.7% year-over-year to 2.57 million, with the number of paid weeks slumping 15.7%.

Now what: Along with reporting a better-than-expected third quarter, Weight Watchers raised its guidance for the full year. EPS is expected to be between $0.64 and $0.74, still down significantly compared to EPS of $1.74 during 2014, but higher than the company's previous guidance of $0.57-$0.72.

The effects of the Winfrey partnership won't start to truly play out until next year, following the company's December revamp of its program and a new advertising campaign. The stock surged on news of the Winfrey deal in October, and following the post-earnings jump today, shares have now risen by about 280% over the past three months. The stock is now nearly flat year-to-date as extreme pessimism surrounding the company has given way to Oprah-fueled optimism, but the company still has a lot of work to do in order to turn around its business.